Deferring or Forbearing Your Student Loans

A deferment excuses you from making student loan payments for a set period of time because of a specific condition in your life—like returning to school, economic hardship, cancer treatment, or unemployment. Interest will not accrue on subsidized loans during the deferment period.

In a forbearance, your loan holder gives you permission to stop making payments for a set period of time or temporarily reduces your payments. Interest always continues to accrue during a forbearance. In some circumstances, a forbearance might be available even if you've defaulted.

Canceling Student Loans

In certain limited circumstances, you might be able to cancel your student loan—meaning that you no longer have to pay it. Doing this is not easy; you'll have to meet specific conditions depending on the type of loan you have.

Often, when you cancel your loan, the government will also reimburse you for payments already made, and help clean up your credit record. In some situations, you won't be able to cancel the entire loan, but you might be able to get rid of a portion of it.

Loan cancellation—also called loan discharge—is available only in certain, specific situations, including:

you attended a school that closed

you didn't get a refund where appropriate

your school falsely certified that you would benefit from the education and you don't have a GED or high school diploma